Editor’s note: This is the first of four stories about the VC FinTech Accelerator program at the Little Rock-based Venture Center.
The ongoing VC FinTech Accelerator program is being hailed by Venture Center officials as the only FinTech program connecting entrepreneurs directly to the “C-Suite leadership” of FIS, the world’s largest financial technology services company.
The program launched May 16, and a demo day is set for Aug. 3 at the Clinton Presidential Center in Little Rock. Selected participants engage in what the Venture Center says is a “12-week rigorous program” designed to “accelerate the growth of early state FinTech (financial technology) startups.” Curriculum in the program includes compliance, regulatory issues, security and risk management and specialized financial services.
“As the birthplace of early FinTech innovators like Systematics, Arkansas Systems, ABC Financial, Stephens Inc., Mainstream Technologies, and Acxiom and the home of the only FinTech Accelerator powered by the world’s largest financial technology company, Central Arkansas is the place for startups seeking to disrupt the FinTech space,” notes the Venture Center website page explaining the program.
Jacksonville, Fla.-based FIS (NYSE: FIS) has more than 55,000 employees around the globe, and has more than 20,000 clients in more than 130 countries. On July 26 the company reported second quarter income of $120 million, down from $242 million in the same quarter of 2015. Revenue in the quarter was $2.3 billion, up from $1.6 billion in the 2015 quarter.
VENTURE CENTER FINTECH PARTICIPANTS
The FinTech participants have roots that stretch across the globe, including Africa, Switzerland, India and the United States. Each received a $50,000 investment as part of being selected. Following is a brief description of the participants in the FinTech Accelerator and why their respective concepts are important in the financial services sector.
The company is based in Chicago and founded by executives with 30-plus years of enterprise sales in the financial services industry. Akouba provides an online, end- to-end commercial loan platform that enables banks, credit unions and other financial institutions to lend money to small businesses simply, efficiently and profitably.
Why it’s important: Akouba believes it can be the leader in the Digital Transformation at community and regional banks to ensure they keep their trusted brands and customer relationships relevant for the next few decades.
The company’s co-founders have backgrounds in the areas of mobile technology, global telecommunications regulations, mobile payment systems, and financial regulations and the fast casual restaurant business. Bleu is pioneering a White-label Point of Sale system and universal payment gateway, powered by Bluetooth beacons, enabling all forms of payment including EMV, and a mobile platform for customer loyalty and engagement.
Why it’s important: Payments are broken because merchants are operating blind. Every card swipe is a wasted opportunity to learn more about the customer than ever before. Regardless if the merchant is using a fancy tablet, or an old out of date legacy POS, every card swipe is not a customer, it is a just a transaction ID. Bleu’s aim is to change that by capturing customer data that will be useful to merchants.
Dream Forward Financial
The founder is the first “robo” advisor analyst covering this space from 2011-2015. Dream Forward sells businesses a 401(k) plan. The Dream Forward 401(k) offers low costs, no conflicts of interest, and new technology to boost the savings rate among middle and lower income employees.
Why it’s important: Right now America now faces a retirement crisis as the “average joe” isn’t saving enough for retirement. Dream Forward’s Emotional Advisor technology targets the most vulnerable employees and intervenes to keep people on track if they try to do something that’s not in their long-term interest.
The company’s founder has a background raising money from Facebook founder Mark Zuckerberg to train African engineers to get tech jobs. Flutterwave partners with African and U.S. banks to build technology and infrastructure for U.S.merchants doing business in Africa. Flutterwave allows the U.S. merchants to get paid instantly across Africa over a secure system.
Why it’s important: Americans and American companies send $5 billion in investments and payments every year to Nigeria alone. However, most of this money is trapped because there is no reliable way to get the money out. As a result, several promising U.S. businesses like United Airlines have closed their operations in Nigeria denying jobs to American and Nigerians who badly need them. Fixing this problem will enable commerce between the U.S. and Africa to flow smoothly – creating wealth and jobs for Americans and creating opportunities for Africans.
Company founders have expertise in commodity markets, manager futures spaces, hedge funds and derivatives consulting. The company offers a solution allowing any trader in the world to link their brokerage account to a website, establish a verified track record, and gain access to numerous trading tools, such as a chart of their equity curve. In the future, the investment arm of FundSeeder, FundSeeder Investments help identify the top performing traders and look to allocate to them directly. The mission of the platform is to “democratize and globalize the asset management world”, and could potentially find the next generation of talented traders, including the next Market Wizards.
Why it’s important: The investment environment overlooks a tremendous scope of other traders who have talent and can outperform larger asset managers, but do not have access to capital.
The founders have backgrounds in business strategy with experience building and growing technology companies. LumoXchange is creating the world’s first localized money transfer marketplace to compare exchange rates in countries across the world. Its platform enables individuals to send online money abroad using local FX rates at lower cost compared to current providers.
Why it’s important: $436 billion out of the $610 billion that is sent abroad goes to developing counties to help more than 750 million families across the world. Reducing the cost of sending money abroad can have a significant impact on the financial well-being of families across the world.
The company founders have a background in regulatory compliance for banks. Hexanika is a FinTech big data software company, which has developed an end-to-end solution for financial institutions to address data sourcing and reporting challenges for regulatory compliance.
Why it’s important: Developing an audit trail of transaction level data and meeting dynamic business and regulatory requirements are challenges that banks face as the legacy system architecture does not cope well. Hexanika can ease regulatory compliance for banks and help reduce compliance costs.
The company founders met while students at the College of Charleston. Two have graduated with degrees in computer science and political science. The third founder is still a student pursing degrees in Finance and Accounting. Monotto uses smart algorithms to completely automate the process of saving and investing. The goal is to take a user from struggling financially to financially stable without any additional work.
Why it’s important: This is important because young Americans are awful with finances. It is sad but true, and we know it is true because the millennial saving rate is negative 2% meaning they spend more than they make every year.
Mortgage Peer Network
The founders have backgrounds managing capital markets for mortgage lending firms and in all facets of mortgage origination, secondary marketing, servicing, default management and analytics. The company serves the mortgage origination industry.
Why it’s important: Lenders now compare operational and customer satisfaction to peer lenders on the network. Mortgage Peer Network integrates with the consumer’s social networks to create new referrals for the lender.
The company founder is a nationally known author and speaker who has trained hundreds of CFOs, treasurers and industry professional on managing bond portfolios. The company’s unique Bond Price Validation tools (BPV) brings transparency to the bond market and has the ability to provide strong internal controls that regulators love, keeping CFOs and Treasurers out of hot water. PFITR’s BPV™ product is focused on providing good, unbiased data to improve decision-making for bond investors.
Why it’s important: The company’s solution identifies, measures, and helps CFOs mitigate risk.
The next story in the series will address how the Venture Center hopes to build on successes that emerge from the FinTech Accelerator.